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December 4, 2022

CAS 5 pc cut, on debate tomorrow in Parliament

The economic policy of Bucharest authorities still relies on maintaining the flat tax rate, the tax exemption of reinvested profit and the reduction of the social security contributions (CAS) as incentives for the business environment.

With this regard, on Monday, PM Victor Ponta appealed to his social-democratic colleagues, in the beginning of the session of the PSD Permanent National Bureau, to vote in favour of lowering the CAS.

“(…) We must do more in social terms. We returned pensions and salaries, but there are many other problems we must fix in the future, so that everybody can feel this economic growth, not just some of us,” Ponta stated.

He added that tomorrow the Government will send to the Parliament the draft modification of the Fiscal Code regarding this measure. Also, the measure will be voted by the Senate in this parliamentary session and will be adopted by the Chamber in extraordinary session, called at the beginning of July.

“I believe the vote will be quasi-unanimous. It is a very good economic measure which USL has proposed and they initiated a no-confidence motion over it” (the initiators of the motion were deputies and senators from PNL, joined by MPs of PDL, Civic Force, PP-DD and an independent senator).

“I remind you that PDL submitted ever since last year a draft law for the reduction of the CAS by 5 percent points for employers. So, we are the initiators of this draft law and it is in our electoral programme for the general elections of 2012. The matter is at the government,” PDL leader Vasile Blaga answered. He added that he told the IMF that the democrat-liberals reject the enacting of new taxes meant to fill the income gap produced by the reduction of the CAS and that “the government should present to the Fund a very clear analysis of this matter, which did not happen.”

If the draft law comes into force, starting October 1 the contributions to the social insurances system paid by employers will be reduced by 5 percent, resulting a budgetary impact of RON 850 M, without the increase of the budget deficit, as the prime minister said that the measure was not endorsed by the IMF and was assumed by the government.

The negative impact generated on the budget by the reduction of the CAS, calculated at RON 4.8 bln for 2015, will be covered by authorities – among others – with sums attracted from controls to high-income individuals and those who have financial sources abroad, and with debts recovered using the new Law of insolvency. In order to raise more funds to the budget, the government will re-launch the notification campaign of sending letters to the taxpayers which presented the risk of not submitting the statements for incomes generated abroad, reveals the draft law for the reduction of the CAS obtained by Mediafax.


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